Which version of Vegas do you have?
In Vegas 6, there's an option for "Apple iPod 320x240 Video".
In Vegas 7 & 8, there are options for "Apple iPod 320x240 Video" and "Apple iPod 640x480 Video".
Select "MainConcept AVC/AAC (*.mp4) in the "Save as type" dropdown box and you'll see these in the "Template" box.
I am doing Render As. My choices are: ATRAC, AIFF,FLAC, mp3, oggvobis, quicktime, real media, scott studios, sony perfect, sony wav 64, video for windows(avi), wav microsoft, windows media audio, windows media video
Looks like you have no mpeg2/AC3/AVC exporting available.
If your Vegas doesn't offer you these codecs to export it means that either:
1. You forgot to install the companion application DVD Architect (offers mpeg2/AC3).
2. You pirated Vegas and so these codecs refuse to work without online registration (mpeg2/AC3/AVC h.264).
Many thanks. I believe I have a pucker version - I bought it from a dealer on eBay (in the US) and although it was not sealed eveything seemed to be ok. No 2nd disc though!